National figures suggest about 76,000 young people are employed under so-called zero-hours contracts.
Business secretary Vince Cable announced the probe after trade unions voiced concerns that the employment tactic was exploiting vulnerable groups – in particular young people seeing work experience.
According to the Office of National Statistics (ONS), almost a quarter of Britain’s major employers are using the method, which places employees on standby.
In May, the ONS revealed the number of 16- to 24-year-olds employed under such conditions had risen from 35,000 in 2008 to 76,000 in 2012.
The Department for Business, Innovation and Skills plans to carry out an informal fact-finding exercise, by speaking to industry bodies using this form of contracting.
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